GOLDEN, Colo., March 31 /PRNewswire/ -- Ray A. Geddes, chairman and chief executive officer of Unique Mobility Inc. (AMEX: UQM.EC), today released the following text of the company's First Quarterly Report of 1993 to shareholders:
"Operating results for the first quarter of fiscal 1993 reflect the company's continued -- and we believe highly successful -- investment in the commercialization of advanced electric traction drive systems for clean vehicles and the furtherance of strategic relationships with various partners around the world.
"Operations during the quarter ended January 31, 1993, resulted in a net loss of $619,245 or $0.08 per share on total revenue of $435,754, versus a net loss of $346,192 or $0.05 per share on total revenue of $733,085 for the year earlier period. In addition to the decline in revenue, major factors contributing to the higher current quarter loss included an increase of $110,592 in research and development expense and a one-time charge of $38,000 to provide for an anticipated overrun on a firm fixed price Federal Government contract. General and administrative expense during the quarter declined by $145,152 to $262,565.
"The decline in contract service revenue has resulted, in part, from the company's recently adopted policy of internally funding and/or cost sharing the development of promising new technologies in order to maximize its retention of intellectual property rights. In cases where the company has elected to forego some or all available third party funding, there is a proportional reduction in revenue and increase in expense. To offset this effect, the company has accelerated its marketing activities and has recently responded to proposal solicitations having an aggregate contract value of more than $6 million. Proposal recipients include Allied Signal, Chrysler Pentastar, Ford Motor Company, Hyundai Motor Company, United Technologies Corporation, Walt Disney and various agencies of the U.S. Department of Energy and Department of Defense. Approximately $1.5 million of this potential contract value must be cost shared by the company. Management believes that there is a high probability that these pending proposals will result in several contract awards which should favorably impact revenue during the second half of fiscal 1993.
"The company's pilot production and sale of motors and controllers is also trending up. During the first four months of fiscal 1993, the company booked sales and firm orders of approximately $700,000 compared to full year sales of $324,000 and $470,000 for all of fiscal 1991 and 1992, respectively. Production has been launched on the BMW SR218 motor and controller and a new SR180 `segment motor' and controller. The introduction of these new systems should also favorably impact revenue during the second half of fiscal 1993."
Liquidity and Capital Resources
"As previously reported in November 1992, the company completed a public offering of one million shares of its common stock at $5.00 per share and in December 1992, the underwriters exercised their overallotment option to acquire an additional 150,000 shares at $5.00 per share. Net proceeds to the company from the offering and exercise of the overallotment option were approximately $4.8 million. Primarily as a result of the above transactions, cash and cash equivalents and investment securities rose to $5,608,775 at January 31, 1993, an increase of $4,116,093 over the previous year.
"In February 1993, the Advent Group converted $1.2 million of the company's 8 percent secured convertible term notes into 666,666 shares of common stock. The proforma effect of this transaction increased stockholders' equity and reduced long term debt by $1.2 million, respectively. Additionally, the transaction improves liquidity to the extent that the company is relieved of the future obligation to make payments of interest and principal to the Advent Group.
"For the remainder of the year, the company expects to see some improvement in revenue relative to the first quarter, but intends to continue to expend significant amounts of cash toward the implementation of its business plan. These expenditures are expected to result in continued operating losses. Existing cash resources are deemed adequate to fund such activities."
Strategic Partnerships
"In December 1992, the company executed a Letter of Intent with ABB Asea Brown Boveri Ltd. (ABB) and BMW Technik GmbH, a wholly owned subsidiary of Bayerische Motoren Werke AG (BMW), covering a cooperation for the commercialization of Unique's permanent magnet motor technology. In the first stage of the cooperation, which is to be completed by April 30, 1993, the resources of ABB, BMW and Unique are being evaluated to determine how they can best be combined to further the commercial effort. At the same time, pilot production of the BMW motor has been launched at Unique and the company has received an order from BMW to produce 20 electric vehicle traction systems for delivery during 1993. This order has a contract value of $400,000. In the following stages of the ABB-BMW-Unique cooperation, the Letter of Intent contemplates the formation of a joint venture for the higher volume manufacture and marketing of electric traction drive systems to the automotive industry throughout Europe and North America.
"In March 1993, the company entered into an agreement with Flywheel Energy Systems Inc. (FES) and Dr. Ralph Flanagan of the University of Ottawa to cooperate on the design and development of ultra high speed flywheel energy storage systems. As part of this effort, the company will undertake to assemble and test a near-term proof of principle flywheel system as a continuation of the previous research funded by Alcan Aluminium Limited.
"Also in March 1993, the company reached an agreement in principle with United Technologies Corporation (UTC) to undertake the commercial development of advanced flywheel systems for both mobile (automotive) and stationary (industrial) applications. The agreement with UTC may include technology resulting from the FES cooperation as well as other technologies. Pursuant to the UTC agreement, UTC and Unique have teamed with Ford Motor Company (Ford) on a proposal to the U.S. Department of Energy (DOE) for the design and development of a hybrid electric vehicle flywheel system.
"In addition to the above, Ford has invited the company to participate in another technology area of the DOE hybrid proposal, namely, the development of a wheelmotor traction system. Accordingly, the company has developed a separate technical proposal for Ford which was submitted to DOE on March 26, 1993. If a contract is awarded pursuant to the Ford-Unique proposal, it is anticipated that DOE will provide 50 percent of the funding with the balance to be provided by the proposing parties on a basis to be determined.
"Again in March 1993, the company entered into an agreement with Hitachi Metals Ltd. (Tokyo) relating to the joint development of an advanced permanent magnet rotor design capable of being used with Unique's patented narrow slot stator. Hitachi and Unique will be joint owners of any intellectual property resulting from the development. Hitachi Metals is a world leader in the field of magnetic materials and alloys for the electronics industry."
Other Developments
"The company's hybrid electric traction system has been installed in a natural gas fueled prototype bus and has been demonstrated in Toronto by Ontario Bus Industries. The bus is currently undergoing evaluation and road test at Unique.
"The company has completed work on the application of a Unique motor and electronic drive to a tele-robotic manipulator arm for NASA Lewis Research Center. The system has been shipped to a subcontractor for final test and evaluation. The company has also teamed with Allied Signal Fluid Systems on a proposal for the U.S. Navy's Mobile Multifunctional Device (MMD) and a proof of principle motor was successfully tested and delivered to Allied Signal in January 1993.
"A prototype SR111 lawn mower motor with controller was delivered to Deere & Company in February 1993. The system exceeded performance targets and an additional two prototype systems are scheduled for delivery in April 1993.
"In March 1993, the company entered into a consulting contract with Carroll Shelby, a world renowned authority in the field of high performance and specialty automobiles. Mr. Shelby will assist the company with respect to the design, development and commercialization of extended performance hybrid electric vehicle propulsion systems.
"The company's annual meeting of shareholders will be held on April 16, 1993, at 10:00 a.m. MDT at the Hyatt Regency Denver Hotel, 1750 Welton Street, Denver, Colorado."
Unique is a Golden-based engineering concern and manufacturer of high efficiency and high power permanent magnet motors and electronic controls for automotive, aerospace and general industrial applications. Unique's stock trades on the Emerging Company Marketplace of the American Stock Exchange.
-0- 3/31/93
/CONTACT: Donald A. French of Unique Mobility, 303-278-2002/
(UQM)

CO: Unique Mobility Inc. ST: Colorado IN: AUT ARO SU:

MC -- DV001 -- 1388 03/31/93 09:31 EST

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